Research On Real And Accrued Earnings Management In Performance-based Equity Incentives

Due to the existence of the company's entrusted agency mechanism,the equity incentive system can improve the company's salary mechanism to a certain extent,reduce corporate agency costs,and bring a certain positive effect on corporate governance and operation.Therefore,the equity incentive system is increasingly valued by companies.However,due to the late introduction of the equity incentive system in China,the current equity incentive system has many deficiencies in theory and practice,and it has not achieved the expected incentive effect.At the same time,under the background of immature capital market and greater flexibility of accounting standards,the equity incentive system is closely related to the interests of management.As an agent of the enterprise,management has the incentive and space to implement earnings management behavior,making the equity incentive system become Its tools for obtaining its own noneffort income may aggravate the principal-agent problem.Based on this,the core research problem of this paper is to analyze the company's earnings management behavior under the equity incentive system,including the case company's motivation analysis for implementing earnings management behavior under the equity incentive plan,specific earnings management means analysis and consequence analysis,and put forward relevant suggestions.The article takes the science and technology board high-tech enterprise Huali Chuangtong as an example,and finds that it has a series of earnings management behaviors during the implementation of the equity incentive plan.The research found that the earnings management behavior of the case company during the implementation of the equity incentive plan was mainly due to the motivation of the compensation contract by the management.The earnings management methods adopted were mainly changes in accounting estimates and accounting policies,including changes in the capitalization rate of R & D expenditure and bad debts.The provision ratio for preparation and the setting of exercise conditions for equity incentive plans are relatively weak.Huali Chuangtong implements earnings management to regulate profits and achieve the standardization of the equity incentive plan,which enables executives to obtain non-effort income,smoothing certain annual profits,and also helping the company's financing behavior and stock price.Although earnings management behavior brings benefits to the company itself and some stakeholders in the short term,unrealistic performance under the equity incentive system will adversely affect the company's future long-term development.In the past,there have been many researches on the issue of equity incentives,but they mainly focused on the relationship between equity incentives and corporate governance,equity incentives and company operating performance.Few scholars have specifically studied the earnings management in the implementation of equity incentives.At the same time,in the past,scholars used empirical methods to study the relationship between equity incentives and earnings management,and rarely used case studies.The innovative point of this article is to study the company's earnings management behavior with equity incentives as the starting point,and analyze the series of earnings management behaviors during the implementation of equity incentive plans by combining theory with specific cases.At the same time,case studies are designed to enrich equity incentives and earnings management.Theoretical research in other areas also has farreaching significance.The application value of this article lies in revealing the motivation relationship and specific manipulation methods between the implementation of equity incentive programs and executive earnings management behaviors.Which is conducive to the company's long-term management and management,and also helps investors to better identify corporate earnings management behaviors To reduce non-performing investments and better protect the interests of small and medium investors.It is of great significance to regulate the capital market,to regulate the company's business activities,maintain the stability of the capital market and protect the interests of investors.